Sia Completes Hard Fork as Bricked Miners Form Rival Blockchain

The distributed cloud storage blockchain network Sia has successfully completed a planned hard fork, changing its consensus rules in a way that prevents some specialized hardware from mining on the network.

“All is working normally now,” David Vorick, co-founder and CEO of Nebulous, the for-profit company behind the Sia network, told CoinDesk on Thursday.

The fork, planned for the previous day, was set to take place at block 179,000 in the Sia chain, but miners found themselves stuck at block 178,999 for hours because, as Vorick wrote in a community forum Wednesday evening, an error in the code meant that miners “will need to mine at least one block at full difficulty before the adjustment kicks in. This may take anywhere from 6 to 48 hours.”

The block was found shortly before 6:00 a.m. ET. Following that block, the difficulty – a parameter that blockchains use to ensure that blocks are mined at fairly regular time intervals, whatever the total computing power of the network – dropped by around 98 percent, allowing miners to resume finding blocks every 10 minutes on average.

Following the fork, though, the Sia network had far fewer miners.

The purpose of the change to Sia’s consensus rules was to “brick” or disable specialized mining hardware manufactured by Bitmain and especially Innosilicon. And in that respect, Vorick said, “the hardfork trick worked.”

As a result, there is only one type of mining equipment able to crunch through Sia’s new hash algorithm fast enough to compete – and these are manufactured by Obelisk, a subsidiary of Nebulous.

Obelisk was unveiled in June 2017 as a chip manufacturer to challenge Bitmain – the dominant player in the market for cryptocurrency application-specific integrated circuits (ASICs), as specialized mining equipment is known. Obelisk announced that its first product would be an ASIC for Sia, but within months it had become clear that Bitmain had beaten Obelisk to market and was using its Sia ASICs to mine on the network in secret.

In January, Bitmain went public with its product, and in April another manufacturer, Innosilicon, came out with an even faster Sia ASIC. Obelisk had still not shipped its ASICs, and its June 30 deadline for doing so came and went. Threats of legal action followed. The first Obelisk ASICs shipped in August, with the last going out in mid-October.

Nebulous had a trick up its sleeve, however: a kill switch that would enable the company to change the Sia algorithm in a way that would disable other miners, but let Obelisk miners keep running. After nearly a year of debate, Nebulous announced at the beginning of October that it would flip that kill switch and fork the network.

Vorick told CoinDesk Thursday:

“The reason we had the secret circuit was to activate it in the event of a malicious mining attack. While there was not ever a direct attack on the consensus system, much of the community felt that the secret development of ASICs was an attack, and also felt that one farm owning 45 percent of the hash rate was risky, and justified forcing a [proof of work] change.”

SiaClassic

Not everyone was happy with the decision to fork – in particular those who had invested in Innosilicon hardware. While Vorick characterized community support for the move as over 90 percent, some have characterized it as a “protectionist” bailout for the company he leads.

As has happened with other controversial hard forks – most notably ethereum’s following the DAO theft – part of the community has decided to continue using the old Sia protocol. SiaClassic, as this group calls itself (in a conscious nod to Ethereum Classic), has set up a separate foundation and separate social media forums.

The group has also published a “Declaration of Independence.” SiaClassic miners kept finding blocks without interruption, even as the “main,” Nebulous-endorsed chain stalled briefly.

SiaClassic “has very low community support,” Vorick said. “They say they believe in the vision though, and that they wish to have a collaborative relationship with the main chain. If SiaClassic does get support, then we are happy to engage them collaboratively. But so far we’ve seen little evidence of actual support outside of SiaClassic employees.”

The SiaClassic Foundation said in a statement to CoinDesk, “We greatly respect Siacoin’s founding principles, and the people who have supported them since the very beginning. We are focused on the future. We are excited about the team we’ve built, and we look forward to working with the SiaClassic community to take this project to the next level.”

At least two other non-Nebulous groups have also emerged: Sia Prime, which Vorick said was “also collaborative with Nebulous,” leaving the mechanism that funds Nebulous in the code in what he called “a big sign of good faith.”

Finally, Hyperspace is “an adversarial fork that wishes to replace Nebulous,” Vorick said, although they “have not written any storage platform code themselves.”

Mark Huetsch, project lead at Hyperspace, responded, “We are not looking to replace Nebulous. We’ve made a number of innovations on the codebase including scriptless atomic swaps using Schnorr signatures as well as SPV node support. We encourage Nebulous to merge these enhancements into Sia but, particularly with respect to SPV node support, they have seemed uninclined to do so.

Vorick characterized the fork as a success for the Sia community. “The hashrate is much much more decentralized than before the fork,” he said, estimating that 87 percent of the network’s computing power was accounted for by “community members.”

While it may be too early to tell, however, it seems that there may no longer be just one Sia community.

UPDATE (16:40 UTC, Nov. 2, 2018): This article has been updated to include a statement from the SiaClassic Foundation. (13:15 UTC, Nov. 5, 2018): This article has been updated to include a statement from Hyperspace.

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